Introduction to Foreign Exchange Market
A foreign exchange market is market in which currencies are bought andsold. It is to be distinguished from a financial market where currencies areborrowed and lent.”
Foreign exchange market is the largest financial market in the world. It has its ownspecial features with respect to the way it is organized, the participants in themarket and the method by which the transaction is settled.Some salient features of forex market
Size of the market.
Flexibility in trading.The foreign exchange market is the largest market in the world. Daily tradingvolumes often exceed US $100 billion which is more than 50 times the volume onthe New York Stock Exchange.
There are four main participants in foreign exchange market. They are retailcustomer, commercial banks, foreign exchange brokers and central banks.